Parnell: Two things I would change in the tax code

There are so many things wrong with our tax code and most politicians try to capitalize on this by making broad generalizations and promises which they can’t possibly deliver. I’m not going to do that.

Instead, today I’d like to talk about two things you might not realize about our current tax code and how, together, we can change them.

Now, let’s be clear. I’m not suggesting that making these two changes will fix a tax code that increasingly benefits the biggest corporations and the wealthiest Americans while increasing the deficit and leaving working families to pick up the tab. Far from it. But it’s a start.

First, we must cut the tax on Social Security benefits.

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Didn’t know that the federal government taxes your Social Security benefits? If you make more than $25,000/year ($32,000 for married filers), it does. But that must mean that, when you pay into Social Security, you can deduct that from your income tax. Right?

Wrong.

You work your whole life paying into Social Security but, once you start receiving the benefits you’ve paid for, the IRS levies income tax on up to 85 percent of your benefits. This impacts more than half of all Social Security recipients.

That tax is wrong on many levels and we should eliminate it as soon as possible and, when elected, I will work to do just that beginning by raising the threshold. Instead of $25,000/year, let’s raise it to those with incomes of $80,000/year while drawing Social Security benefits ($100,000 for married filers). This alone would help more than 90 percent of those affected.

It’s simple, it’s effective and it’s achievable.

Secondly, we should immediately repeal the Church Tax hidden inside the GOP Tax Plan that passed last year.

I know, it sounds ridiculous, but it’s true. President Trump’s so-called “Tax Cut” proposal imposed a new 21 percent tax on churches and charitable organizations. Furthermore, now the GOP Congressmen and women who voted for it are trying to defend it by explaining it only applies to fringe benefits such as providing meals, paying commuting costs or providing parking for employees.

They can try to spin and excuse it any way they want but, at the end of the day, they still voted for a tax on churches and they should own it.

What’s more, they did it to offset the cost of providing huge tax cuts to corporations. Here’s an example of what I’m talking about: under the recent GOP tax law, big corporations can deduct 100 percent of dividend payments they receive from their foreign subsidiaries.

In other words, if a corporation like IBM starts a subsidiary in the United States, the profits are taxable. If it starts one overseas, however, those profits can be tax-free. So, we’re rewarding big corporations for investing overseas instead of here at home and taxing churches and social security benefits (and other things) to pay for it.